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The 2003 – 2004 Zambia Small and Medium Enterprises (SME) Survey, commissioned by the Ministry of Commerce, Trade and Industry, presents an analysis of the size of the sector, its contribution to the national economy and the types of support necessary for the sector to develop.

It is generally recognised that the trade liberalisation and privatisation process that occurred over the last few years, may have been done too fast and perhaps with insufficient consultations between the Government and the private sector. As a result, trade liberalisation and privatisation, although they played a major role in contributing to economic growth, have not been perceived to have been as effective and beneficial to Zambia as anticipated. The perception was amplified by the pull out of Anglo American Corporation from the traditional mining sector, and the realisation that Zambia must diversify in order to survive.

The notions of decline in the manufacturing sector of the Zambian economy after the adoption of a liberal economic framework in 1991 gave rise to concern and debate among policy makers such as the Ministry of Commerce, Trade and Industry (MCTI) that resulted in undertaking the Manufacturing Sector Survey in 2002.

Zambia is not a major producer of cotton in the global market; however, according to the Cotton Development Trust (CDT) of Zambia approximately 227,000 smallholder farmers produce cotton on 254,000 hectares of land. Many of these cotton farmers also integrate the production of cotton with the growing of staple foods such as maize. In 2004 Zambia produced 172,000 MT of cotton which generated nearly US$50 million in export earnings of cotton products, such as lint cotton, cotton yarn and ready-made cotton garments. In some cases, here strong out-grower programs have been developed for seed cotton farmers, yield increased from 500 - 600kg/ha in 2000 to 700 - 800kg/ha in 2001.